Rent here, buy there: The first house these Bay Area residents purchased wasn’t in the Bay Area

Updated 10:26 am, Wednesday, September 6, 2017

Some people are renting homes in the Bay Area, but buying property elsewhere, like Bay Area native Ben Hunter. Pictured above: Hunter's investment property on the Atlantic City waterfront.

Some people are renting homes in the Bay Area, but buying property elsewhere, like Bay Area native Ben Hunter. Pictured above: Hunter's investment property on the Atlantic City waterfront.

Photo: Courtesy: Ben Hunter

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Where should homebuyers look to invest? These cities are the top options, according to Forbes, based on current median prices and projected growth.

Where should homebuyers look to invest? These cities are the top options, according to Forbes, based on current median prices and projected growth.

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20. San Antonio, Texas

Average home price: $210,000

3-year price growth forecast: 17%

20. San Antonio, Texas

Average home price: $210,000

3-year price growth forecast: 17%

Photo: Don Klumpp/Getty Images

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19. Phoenix

Average home price: $243,000

3-year price growth forecast: 18%

19. Phoenix

Average home price: $243,000

3-year price growth forecast: 18%

Photo: Joseph Plotz/Getty Images

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18. Atlanta

Average home price: $213,000

3-year price growth forecast: 19%

18. Atlanta

Average home price: $213,000

3-year price growth forecast: 19%

Photo: Joe Daniel Price/Getty Images

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17. Columbus, Ohio

Average home price: $207,000

3-year price growth forecast: 19%

17. Columbus, Ohio

Average home price: $207,000

3-year price growth forecast: 19%

Photo: Ian Spanier/Getty Images/Image Source

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16. Boston, Mass.

Average home price: $371,000

3-year price growth forecast: 20%

16. Boston, Mass.

Average home price: $371,000

3-year price growth forecast: 20%

Photo: Tomasz Szulczewski/Getty Images

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15. Las Vegas

Average home price: $200,000

3-year price growth forecast: 20%

15. Las Vegas

Average home price: $200,000

3-year price growth forecast: 20%

Photo: RebeccaAng/Getty Images/RooM RF

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14. San Diego, Calif.

Average home price: $436,000

3-year price growth forecast: 21%

14. San Diego, Calif.

Average home price: $436,000

3-year price growth forecast: 21%

Photo: Christopher A. Jones/Getty Images

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13. Raleigh, N.C.

Average home price: $254,000

3-year price growth forecast: 21%

13. Raleigh, N.C.

Average home price: $254,000

3-year price growth forecast: 21%

Photo: Rick Nelson / EyeEm/Getty Images/EyeEm

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12. Charlotte, N.C.

Average home price: $235,000

3-year price growth forecast: 21%

12. Charlotte, N.C.

Average home price: $235,000

3-year price growth forecast: 21%

Photo: Robert Loe/Getty Images

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11. Sacramento, Calif.

Average home price: $291,000

3-year price growth forecast: 22%

11. Sacramento, Calif.

Average home price: $291,000

3-year price growth forecast: 22%

Photo: Richard Cummins/Getty Images/Lonely Planet Images

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10. Grand Rapids, Mich.

Average home price: $166,000

3-year price growth forecast: 23%

10. Grand Rapids, Mich.

Average home price: $166,000

3-year price growth forecast: 23%

Photo: Danita Delimont/Getty Images/Gallo Images

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9. Fort Worth, Texas

Average home price: $206,000

3-year price growth forecast: 24%

9. Fort Worth, Texas

Average home price: $206,000

3-year price growth forecast: 24%

Photo: Inge Johnsson/Getty Images/age Fotostock RM

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8. Nashville

Average home price: $249,000

3-year price growth forecast: 24%

8. Nashville

Average home price: $249,000

3-year price growth forecast: 24%

Photo: Malcolm MacGregor/Getty Images

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7. Tampa-St. Petersburg, Fla.

Average home price: $213,000

3-year price growth forecast: 25%

7. Tampa-St. Petersburg, Fla.

Average home price: $213,000

3-year price growth forecast: 25%

Photo: BusÃ Photography/Getty Images

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6. Salt Lake City, Utah

Average home price: $277,000

3-year price growth forecast: 25%

6. Salt Lake City, Utah

Average home price: $277,000

3-year price growth forecast: 25%

Photo: Joel Addams/Getty Images/Aurora Creative

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5. West Palm Beach, Fla.

Average home price: $313,000

3-year price growth forecast: 26%

5. West Palm Beach, Fla.

Average home price: $313,000

3-year price growth forecast: 26%

Photo: Richard Cummins/Getty Images

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4. Seattle

Average home price: $416,000

3-year price growth forecast: 26%

4. Seattle

Average home price: $416,000

3-year price growth forecast: 26%

Photo: Zuraimi/Getty Images/RooM RF

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3. Orlando

Average home price: $219,000

3-year price growth forecast: 28%

3. Orlando

Average home price: $219,000

3-year price growth forecast: 28%

Photo: Sky Noir Photography By Bill Dickinson/Getty Images

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2. Jacksonville, Fla.

Average home price: $225,000

3-year price growth forecast: 30%

2. Jacksonville, Fla.

Average home price: $225,000

3-year price growth forecast: 30%

Photo: Henryk Sadura/Getty Images/Tetra Images RF

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1. Dallas

Average home price: $233,000

3-year price growth forecast: 31%

1. Dallas

Average home price: $233,000

3-year price growth forecast: 31%

Photo: Michael Fitzgerald Fine Art Photography Of Texas/Getty Images

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Rent here, buy there: The first house these Bay Area residents purchased wasn’t in the Bay Area

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At 24 years old, Ben Hunter is a homeowner, but a sizable portion of his paycheck goes to rent for a room in an 11-person house in San Francisco. That's because the home he owns is located about 3,000 miles east, in Atlantic City, N.J.

"Growing up, my favorite places were the Santa Cruz Boardwalk, downtown Reno and the county fair. Atlantic City seamlessly combines all three in a setting where Pauly D. is still the resident DJ," Hunter said, referencing the character from decade-old reality show "Jersey Shore."

Hunter never imagined he'd be a property owner in his early 20s, especially with the median home value in San Francisco hovering in the seven digits. But chance intervened, as it often does in Atlantic City.

"Some friends and I went down just for one night, to watch the Warriors NBA game at a sports book," said Hunter, who lived in New York City at the time. "We soon realized sports gambling was illegal (in New Jersey) so we explored the city instead. We fell in love."

Hunter left with the deed to a single-family home on the water. It cost about the equivalent of seven months rent for his room in San Francisco.

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About 35 percent of homes in the county of San Francisco are occupied by their owners, according to census data, compared to 54 percent nationally. If you've ever perused Bay Area housing prices, you can probably guess a major contributing factor to the disparity.

"It's very difficult to get on the property ownership bandwagon here, unless you've got a lot of equity built up," says Gary Beasley, CEO of real estate investment site Roofstock, which specializes in rental properties. Anecdotally, he said he's "shocked" to see how many people rent in the Bay Area and buy elsewhere.

Brooke Hernandez, a Realtor in Lake Tahoe and former president of the South Tahoe Association of Realtors, says about 75 percent of her clientele lives in the Bay Area. She says she’s recently worked with 10 buyers with permanent residences in the Bay Area who can’t afford to purchase homes there.

“It makes sense to me,” she said. “There’s value in investing in real estate, even when you can’t afford what’s in your neighborhood.”

SEE ALSO: Things you'll miss if you leave the Bay Area

You may be thinking of leaving the Bay Area in search of a more affordable to live... but think of all the things you'll miss!

That's the case for San Jose renter Marta Valli. With daughters still in high school and a job in San Jose, Valli says she has no plans to leave the Bay Area. But when her son moved to San Diego for college, she purchased a condo for him to live in, and as a long-term investment.

"I don't have enough savings to buy a house I would want to live in here in San Jose," she said. "But I did have enough to buy a smaller place in San Diego."

Hernandez advises caution, however, as some banks refuse to issue loans to those buying property hundreds of miles away from their permanent residences. If you do secure a loan, you'll likely end up paying higher interest rates and a heftier down payment.

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“Actually, it’s such a pain in the ass,” said Eric Parsonnet of his condo in Springboat Steams, Colo.

“We’re definitely losing money on it, but I guess it’s an investment,” he said. “I mean there’s no way I could find a house with that low of a mortgage in the Bay.”

It took Chris Patton 10 years to see the fruits of his real estate investment. He bought a three-bedroom home in Atlanta after graduating from Georgia Tech, but moved to San Francisco shortly after.

Around that time, the real estate market in Georgia collapsed. For his first six years of homeownership, Patton says rental payments didn't cover his mortgage.

"I had to pay the difference out-of-pocket," he said.

A decade later, Patton says he's finally breaking even each month, but largely because his house value appreciated by $100,000.

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Owning a home far from one's permanent residence requires more than juggling finances. Homes require upkeep, and distance can make that challenging — and expensive.

Michelle A., who preferred to use her last initial for privacy reasons, purchased a home in Ohio 12 years ago. When she returned to the Bay Area in 2015, she says she was shocked by the cost of homeownership from afar, and uncomfortable with the series of third-party transactions required to fix anything.

"The upkeep of the house was costing more than I was making back in rent," she said. She's in the process of selling the house.

For Hunter in Atlantic City, it’s not about the money so much as owning a stake in a city and neighborhood whose future he "hopes to invest in." He’s biding his time until he makes the move to his adopted city.

"I live in San Francisco because that's where the jobs are," he said. “If I had the money, I still don't think I'd buy here. Why would I pay to live here when I could hang out in Atlantic City for a 10th of the cost?"

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